Open a new file, arm one audio track and press Record - dropout is so fast I can barely hear the first metronome click.
 
I don't see how it can be Sonar buffer settings when there's no throughput at all, but I tried moving the slider all the way to Safe to no avail. I want some avail! :)
 
I experimented with Playback I/O and Record I/O per the Help but no change.
 
I'm unable to change the value for Buffers in Playback Queue. It's set to 2 and if I try to edit it, I get a dialog telling me to 'Enter a value from 2 to 2'
 
I turned off all Invidia services except the display driver, I turned off MS Fast Find, antivirus and numerous update services. I've updated the firewire driver for my audio interface. I'm in WDM mode and the Wave Profiler says 48000 hz is OK. Display driver Properties report 'No conflicts.'
 
No problems with MIDI tracks, they record just fine. 
 
Thanks - rev
 
Win 7 Ult x64, Intel i975 quad core 3.33, 12 RAM, Sonar 8.5.33, MOTU Traveler Audio Interface
 

I got it working by switching to ASIO mode, everything plays and records as it should. 
 
Since ASIO mode is a better way to go, I'm considering this solved.
 
Thanks - rev
 
 

Solved
 

that's what I would have suggested.  MOTU doesn't even update their WDM drivers most of the time, some of their products don't even have WDM drivers.  use ASIO.